The costs of health care in the United States continue to climb, and Americans are living longer than ever before. For many, it has become increasingly difficult to afford adequate health insurance. Individuals aging and nearing retirement often face numerous health risks and an increasing likelihood of expensive medical treatments, without the security of an employer's health insurance plan. Large numbers of Americans have not saved adequately to prepare for medical expenses after retirement, such as increasing prescription drug costs and medical procedures that are growing more expensive each year.
Medicare, a federally-administered health insurance program for seniors covering certain costs associated with hospitalization, medical care, and other related health services, provides a partial solution to the problem of growing medical expenses after retirement. However, many financial projections indicate that Medicare may be insolvent in as little as ten years. Additionally, Medicare does not cover individuals under the age of 65, and even for eligible seniors, Medicare often fails to cover many costly medical expenses. For example, Medicare will generally not cover any medical service or item not deemed by a physician to be absolutely necessary, such as physical examinations, routine dental care, and chiropractic services. Medicare also fails to cover all non-prescription drug costs and covers only a portion of prescription drug costs. Thus, Medicare alone is often an inadequate solution for many working Americans looking toward retirement.
In recent years, several other publicly and privately administered health insurance programs have been created to compensate for some of Medicare's deficiencies. For example, some private insurers now offer ‘Medigap’ programs to supplement Medicare coverage. However, Medigap insurance premiums are often expensive and may be unaffordable to many seniors. Additionally, Medigap programs typically require an individual to be eligible for and enrolled in Medicare, thus excluding many retirees from participating in Medigap. Another program, Health Saving Accounts (HSAs), are tax advantaged savings plans available to taxpayers to cover current and future medical expenses. However, contribution amounts to HSAs are limited, and HSAs do not actually provide medical coverage. Finally, some companies offer post-retirement medical (PRM) plan benefits to provide medical insurance to long-standing employees after they retire. However, only a fraction of U.S. companies currently have PRM plans, and many of those are in the process of eliminating these plans in the face of rising medical costs.
Accordingly, there remains a need for systems and methods for providing and supporting pre-funded health insurance programs.